This paper focuses attention on the process of regional branching in which new industries branch out of existing industries at the regional level. There is increasing evidence that the entry and growth of a new industry in a region depends on the local presence of industries to which it is technologically related. We explore how technological relatedness across industries may serve as underpinning for policy to stimulate regional branching. We claim that policy should take the industrial history of the region as a point of departure, and focus on spinoff activity, labour mobility and collaborative networks to connect technologically related industries at the regional level.